Net income more than doubled, to $1.4 billion, from $642 million in the year-earlier period.

The results should allay investor concerns that a slower growth rate in the third quarter was the start of an ominous trend.

The Alibaba results were highly anticipated because the company is preparing for an initial public offering in New York later this year that could value it at $100 billion or more.

“They crushed it,” said Bernstein & Co. research analyst Carlos Kirjner, after the numbers were posted. “These figures justify a valuation [for Alibaba] well in excess of $150 billion.”

Alibaba posted its highest profit margins in the fourth quarter since its numbers were first released publicly in late 2009. Gross profit margin of 78% tied a figure posted in the September quarter of 2010, when Alibaba’s revenue was just about one-ninth of what it is today. Meanwhile operating profit margin of 54% topped Alibaba’s previous record, dating back to late 2009, of 51%.

The results helped drive Yahoo shares up 8% in after-hours trading.

The rising profit margins suggest suggests Alibaba is benefiting from so-called “network effects” as more merchants and more consumers are drawn to the online marketplace it has already built.

Alibaba had previously signaled a big fourth quarter when it reported that shoppers spent $5.8 billion on merchandise across its sites on a one-day shopping festival in November. By comparison, Americans spent $3.6 billion across all online retailers on Black Friday and Cyber Monday combined, estimated comScore.

In part that is thanks to China not having as many brick and mortar retail options for consumers as strip-mall saturated America, a factor that bodes well for the continued growth of Alibaba’s business.

The next step for Alibaba towards its IPO will come when it files its registration statement with the SEC, disclosing more detailed financial figures for the first time. That filing is expected to come within the next month.